Top 5 - First Time Buyer Tips

Hi, everyone, I'm Daniel, and this is Kye here again from Crescent Mortgages, and today we're going to be giving you our top five tips for first time buyers.

It's paramount that you speak to a mortgage professional before you start looking for a property, so that can either be your bank, a different bank or building society, or preferably a mortgage broker because they will have access to far more options than just one specific bank or building society.

The reason for having this conversation first is you need to make sure that you're eligible for a mortgage and confirm roughly what your budget is and how much you can borrow before you know what specific properties to start looking for.

The last thing you want to do is start your property, search first, fall in love with the property and then look into mortgages and find that actually the mortgage that you need will not be achievable. We see this all the time so make sure you speak to a mortgage broker before you start looking for properties.

Yeah, another big one there is the advice you'll get from a broker. Dan mentioned a few points there. The credit reference agency Experian have said that almost half of 30, or 49% of 30 year olds fear they would not be mortgage ready just because they don't understand it, so having that conversation often get's rid of those fears or at least

tells you you need to do. Number two, once you've spoken with a mortgage broker or lender, make sure they provide you with an agreement in principle. Now this is essentially a certificate that confirms that you should be able to obtain a mortgage based on the information you provided.

And it should confirm how much you can borrow as well. Now, this document is important because most estate agents will need to see it before they let you view a property or make an offer on a property. So if you turn up interested in a property without this document, you're probably not going to get very far.

So make sure you get the certificate from you, from your broker. They can sometimes be called a mortgage in principle or decision in principle or an agreement in principle. But essentially, it is the same thing. It's just a document from a mortgage professional confirming that you should be able to get a mortgage. That makes it pretty hard

to view the neighbor's house if it's up on the market. But you can always get a mortgage in principal, and I suppose you can. Mate, I don't quite get that. Well, I mean, there's a lot of people back in the day, that wanted to view your house because it was nice.

Oh, right. We'll see if we'll see if it's clear when we watch your back. Otherwise, we can always cut out. Yeah. Number three, your timeline. So once you have your agreement in principle, you can start looking at properties, have a look online, contact your local estate agent and you can contact them to try and organize

a viewing. It could take a while to find a property that you love. Obviously, go view as many as you need to to make the right decision. But once you've found a property and you've made an offer and it's been accepted, you can then come back to your mortgage broker and they will then find you the best mortgage

on the market that you're eligible for. And then you'll submit the mortgage application, which is usually done within a couple of days. Once that's done, you'll also want to instruct your solicitor. So again, you can either shop around for your own solicitor or your mortgage broker, or the estate agent can usually provide you with a quote for

their own partner so you can instruct your solicitor at the same time. Now, from this point, the mortgage process and the legal work begin. But in terms of when you get the keys, it's not going to happen immediately.

There's quite a lot of work to be done in the background, which isn't. Most of it isn't done by yourself. Most of it will be done by your mortgage broker, the bank and your solicitor. And how long do you think it would normally take to from the moment you get your offer accepted to get the key?

From the moment your offer is accepted, around 12 weeks, sometimes 16. Three to four months is quite normal but can be done much quicker. It can be a lot longer, obviously. But if you if you're budgeting for three to four months, it's normally a relatively safe estimate.

Yeah, without being too stressful. Yeah. But like you say, if you're keen to move quicker than three months and the seller is keen to move quicker than three months, and the solicitor moves forward quickly and there's no hiccups, it certainly can be done quicker.

But on the whole, three to four months is probably a fair average. Number four, your credit. So the first thing that any lender will check when you apply for a mortgage is your credit, so they're going to run a credit check.

Now this this checks two things essentially. Number one, they'll create a credit score for you based on kind of 1,000,000 small factors within their system to confirm their you meet that minimum credit score and every lender has a slightly different kind of scoring process.

And number two, they're actually checking your credit history to see if you've maintained your payments to show that you're kind of your, you're registered where you should be registered and that you've had no no issues in terms of maintaining finance agreements.

So if you have had any kind of missed payments and they could be really, really small that even on a small mobile phone payment, if you've had any missed payments, it could impact your ability to get a mortgage.

So if there's any question mark over your credit, if you can think back and generally it goes back to six years, then check your credit file. And there's lots of different credit agencies online that you can use. Check your credit file to ensure that there's no major issues that maybe you're not aware of that could impact your

ability to get a mortgage, as that is, that is paramount to being able to kind of select the right lender and then the best lenders on the market. Yeah, there are lots of different ways to get credit reports. You'll see there are lots that will try and check lots of them for you.

There are some that are more specific. The biggest credit agency, if you will, is Experian. A lot of lenders use those and they do offer free trials as all of them do normally. But more importantly once you get that report, if you don't understand, that's okay, feel free to send it to your broker and

they'll have a look at it and want to see if there's an issue or not. Yeah, and we should say as well that, you know, if you're very confident that you've never had any credit problems and you've maintained all your credit agreements and you should have a relatively strong score, you don't have to go and

do this, you don't have to check it. It's not. It's not kind of compulsory. But if there's anything you're not sure of or you know you have a potential concern over of your previous track record, then definitely check your your file when again, send it over to your broker so that they can.

They can have a little look and see what options you're going to have. Number five, don't forget about your your costs and some of the additional fees that come up when you're purchasing a property. So first of all, you will almost always need to provide a deposit on the property that you're purchasing.

Now, some lenders can accept a 5% deposit, although bear in mind that the interest rates are higher and the credit checks are a lot stricter, as well as some other kind of stricter criteria as well. So ideally, if you can present a 10% deposit, that will open up more options, but the bigger the deposit generally, the better

. So with every additional 5% you put down, you'll get better interest rates and probably slightly more lenient criteria as well, which makes it slightly more likely that the case will go through smoothly so you will need your deposit.

But don't forget as well that you're going to need to organize a solicitor to oversee the purchase. And again, your broker can recommend someone to you. So you're going to have to cover those fees as well, as well as possibly stamp duty.

Although at the moment for first time buyers, you are exempt under a certain threshold which which may be changing in the future. So again, speak to your solicitor and your broker to get some advice on whether you're going to be liable for that stamp duty.

Other than that, most mortgage brokers will charge a fee, although some, such as Crescent mortgages, are fee free and there's the possibility of you paying a valuation to the bank as they will need to carry out a valuation on the property.

Although a lot of lenders do give free basic mortgage valuations these days now as well. So again, that will be factored into the picking the right scheme for you. I think the deposit is obviously the big one there, and that's what most of you will be aware of.

I think it was great you can put more down, but as Dan mentioned, 5% is enough to get you started. If you've got that sort of amount then that's a good time to maybe start an enquiry and have a conversation with a few people then go from there, if feasible or not.

It's a good point. So that's our top five tips for first time buyers. Now, to be honest, most of these tips will be applicable even if you're purchasing. Even if you're not a first time buyer. When you're actually selling and you're in a chain, most of the tips will be will still be relevant.

So any questions? Put them in the comments. Drop us a message or give us a call. And if you want to find our website showing up on the screen, for you now. Thank you.DPQhcVs-yW0